There’s no shortage of personal finance advice. If you browse the internet, you certainly know that. Every major news reporting or browser web page has a finance tab you can click to read about how you can save money, or manage your money more wisely.
But just how much of the advice do you actually follow?
I thought it would be a fun exercise to list some of the most common financial advice we read about over and over again (including here on Cleverdude) and I would talk about which ones I follow, and which ones I don’t.
Eliminate Credit Card Debt: This is a hard one to argue with. If you carry a balance on credit cards month to month you can almost hear the vacuum cleaner sound sucking money out of your pocket. Our major credit card debt is gone, all that remains is a few small store credit cards which we’re working on next.
Save For Retirement: We’re all going to get old, and hit that magical retirement age. My wife and I have dreams of traveling the world, so I’d better have money stashed away to do so once we reach those golden years. Which reminds me, It’s time to meet with our financial advisor again to make sure we’re on track. Even if you don’t start saving for retirement until you’re in your 30’s, there’s still time to succeed!
Emergency Fund: Having extra money stuffed away but easily accessible gives you peace of mind that you can handle those unplanned incidents that happen in life. Put a check mark next to this one for me, although I’d like to see our account a little bigger than it is right now.
Those are the big three, that 99% of us would agree that we SHOULD follow (are you?). But what about some of those day to day items that maybe aren’t so clear cut?
Pay Cash For Your Vehicle: Again, it’s a matter of paying interest. This is a little harder though, because it takes a lot of discipline to save up the kind of cash to purchase a vehicle. It IS possible to do so, and it would certainly save thousands of dollars in interest payments. This is a future goal of mine, but the reality for my family is, we aren’t there yet. In fact, we just recently signed the paper work to replace our van.
Cable Television: It seems a day doesn’t go by without reading an article about how someone cut the cord, and is now living without cable. They replace standard cable with a multiple faceted solution including catching free broadcast stations, Roku, Hulu, Netflix and a host of other things. Cable is actually something we splurge a little on. We have a fairly healthy package, including some of the premium movie channel tiers as well as a multi-room DVR. I’m not ashamed of it, I love my MTV.
Gym Memberships: Yes, you CAN get in shape without a gym membership. You don’t have to look hard to find creative ways to exercise without paying for monthly gym membership. That being said, I have a gym membership and use it every single day. We got hit with a blizzard in the Midwest last week, and many of the sidewalks where I run either haven’t been cleared yet, or they’re packed with ice and snow. I’m thankful for the indoor track at my gym to run on. I enjoy the variety of expensive machines and facilities that would not be available to me without my gym membership.
Eating Out: Eating at a restaurant is more expensive than eating at home. It burns me to look at a receipt and know that I could have cooked the same thing at home better and cheaper. But sometimes you just don’t feel like expending the effort, or you’re on the go and you need the convenience of someone cooking for you. There’s also the “special occasion” factor. The net is, we eat at home as often as we can, but we do have the occasional meal out.
There’s a reason it’s called personal finance. Your choices are based upon your income, your lifestyle, and your goals for the future. The above gives you snapshot into my choices, now it’s your turn.
Which popular personal finance advice do you follow? Which do you choose not to follow?
Brought to you courtesy of Brock